The original Melbourne Metro - a nine-kilometre tunnel from South Kensington to South Yarra with five stations in the CBD, Parkville and North Melbourne - was being strongly backed by the state government just a year ago, with Transport Minister Terry Mulder indicating engineering issues around Swanston Street had been resolved, new documents reveal.

The February 2013 letter, from Mr Mulder to then treasurer Kim Wells, said the business case for the multibillion-dollar project had been completed and a comprehensive impact statement would be completed by the end of 2013.

The letter, obtained by The Age through freedom of information, said ''significant work was undertaken during 2012 to update the Melbourne Metro business case and ensure it met the requirements of the high value high risk process, Infrastructure Australia guidelines and federal government requirements. This work has proved critical to resolving key issues, including the vertical alignment along Swanston Street.''

The letter said the federal government had committed $40 million in 2009 for planning and development of the Melbourne Metro, and state funding of $49.7 million was allocated in the 2012-13 budget.

Premier Denis Napthine axed Melbourne Metro this month and replaced it with the $8.5 billion to $11 billion Melbourne Rail Link from Melbourne Airport to Southern Cross, South Melbourne, Domain and South Yarra.

In February, Dr Napthine ended bipartisan support for the Metro project when he said digging a hole down Swanston Street ''would be worse than the Berlin Wall''. Earlier Mr Mulder had said: ''The Melbourne Metro project will help transform our rail system.''

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Lord mayor Robert Doyle angrily rejected plans to move the Metro project, describing the move as a ''100-year catastrophe for the city''.

A government spokesman said on Friday the Swanston Street issue had not been resolved and Metro would have meant closing the street to trams for five years - with either a tunnel or cut-and-cover tunnel technique.

The spokesman said the government had switched projects because the Melbourne Rail Link would not affect Swanston Street, would bring increased services, address growth in Melbourne's west and deliver an important airport rail link.

The Napthine government has yet to release a business case for the link.

Mr Mulder told a parliamentary committee on Friday that only parts of the business case would be released because of commercially sensitive material. He also confirmed land acquisitions may be necessary, but landowners will not be consulted until advanced designs were finished.